Does the Baya Bar franchise agreement specify that the franchisee's failure to allow electronic funds transfers or ACH payments is a material breach of the agreement?

According to the 2024 Baya Bar Franchise Disclosure Document, the franchise agreement addresses issues with electronic funds transfers. Specifically, if a Baya Bar franchisee has insufficient funds to honor a check or electronic funds transfer two or more times within any consecutive twelve-month period, it constitutes a default under the agreement.

Furthermore, the Baya Bar franchise agreement outlines that if a franchisee fails to pay amounts due to the franchisor and does not correct the failure within five days after written notice, it is considered a material default. However, Baya Bar is only obligated to provide written notice of a late payment twice in any twelve-month period. A third late payment in that same period becomes a non-curable default.

These stipulations in the Baya Bar franchise agreement serve to protect the franchisor from financial instability or repeated payment issues on the part of the franchisee. It also encourages franchisees to maintain sound financial practices and ensures timely payments to Baya Bar. Franchisees should be aware of these terms to avoid potential default and termination of their franchise agreement.